The stronger US dollar and poor luck factor with VIP gamblers continued to hit earnings for Marina Bay Sands (MBS), as it reported a near 34 per cent drop year on year in profit to US$274.9 million (S$370 million) for the first quarter of FY16.
Stripping out the bad luck factor and adjusting for currency translations, earnings before interest, taxes, depreciation and amortisation would have risen 10.3 per cent.
Total revenue for the quarter was about 23 per cent lower at US$603.7 million, as contributions from nearly all its business segments - with the exception of food and beverage (F&B) - came in lower.
Casino revenue, which contributes to the bulk of top line, slumped 28.3 per cent to US$453.1 million, due in part to a drop in win percentage and the weaker Singapore dollar.
The win percentage - the portion the casino retains - was 1.42 per cent for VIP gamblers, down from 3.41 per cent in the corresponding quarter a year ago.
However, MBS broke revenue record on its mass gaming floor with total mass win-per-day at US$4.8 million.
Parent company Las Vegas Sands' president and chief operating officer Robert Goldstein was upbeat, pointing to rising tourist volumes and a better quality of hotel guests.
In a call with analysts, he said: "We're very happy with the quarter. It's unfortunate we suffered both the currency issues, we can't control that unfortunately, and we had some bad luck in the rolling segment."
He added: "We're seeing more foreign visitation, better quality hotel guests and the continuing phenomenon of what we did in Singapore is just very exciting to us. It's a solid property. It had a bad piece of luck. It happens occasionally."
According to preliminary estimates from the Singapore Tourism Board, the number of visitors from China in the first two months of this year grew nearly 34 per cent year on year.
MBS's hotel business saw high occupancies for the three months ended March 31, 2016, buoyed by robust demand from Chinese travellers. Occupancy rose 3.1 percentage points year on year to 97.9 per cent, although average daily rate slipped nearly 5 per cent to US$394.
This caused revenue per available room (RevPAR) - a measure of operating performance - to slide 1.8 per cent to US$386, while overall revenue from its rooms inched 0.8 per cent lower to US$88.9 million.
Food and beverage business held firm, with revenue edging up by 1.8 per cent to US$46 million. But revenue from the mall was 2 per cent lower at US$39 million and revenue from its convention, retail and other business slid 21.3 per cent to US$21 million.
Meanwhile, Las Vegas Sands missed analyst expectations to post a profit of US$320.17 million, plunging from US$511.92 million, due to a weak performance in key market Macau, while revenue contracted 9.8 per cent to US$2.72 billion.
This article was first published on April 22, 2016.
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